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The country’s manufacturing sector has shown signs of renewed recovery momentum in November as operating conditions approached stabilization and production levels increased for the first time since June, according to a report released yesterday by IHS Markit.
The IHS Markit Philippines Manufacturing Purchasing Managers Index (PMI) rose to 49.9 in November from 48.5 in October, according to the report, which is just below the neutral value of 50 that separates expansion from contraction. .
“The Philippine manufacturing sector showed promising signs of renewed recovery momentum in November as the main PMI figure approached stabilization. Production increased for the first time since June as external demand improved markedly compared to October, ”said Shreeya Patel, an economist at IHS Markit.
“It is encouraging that companies posted the slowest decline in employment in the current sequence of nine months of decline despite a marked decline in back jobs,” Patel added.
The report said that production volumes increased fractionally in the middle of the final quarter of 2020, and companies attributed this to the reopening of business and a smoother reduction in new orders.
“Despite a further reduction in new orders, there were signs that the overall demand outlook improved in November. Businesses recorded only a fractional contraction in the number of new orders placed, as new orders from foreign markets increased moderately, helped by relaxed border restrictions, ”he said.
“The increase in external demand contrasts with the historical average of the series that indicates stabilization,” he added.
However, Patel said the road to recovery may not be easy.
“The health of the sector is based on the number of cases of coronavirus disease 2019 and the impact that the virus has on the global economy,” Patel said.
“While vaccine developments look promising, it is not yet clear when the restrictions will end completely,” Patel added.
